Investors eye Saudi prospects as hotel revenues soar

29th Apr 2012

As Saudi Arabia moves into the spotlight, spending heavily on transport infrastructure to support tourism sector with GDP contribution set to reach US$14.9 billion this year, industry leaders at the Arabian Hotel Investment Conference 2012 (AHIC) will be discussing opportunities in the region.

Flush with petrodollars, with oil prices consistently above $120 a barrel, Saudi Arabia, the United Arab Emirates and Qatar have all embarked on aggressive hotel and transport development programmes as they seek to diversify their economies away from oil and boost revenues from the tourism sector.

The direct contribution of travel and tourism to Saudi Arabia’s GDP is expected to reach US$14.9 billion, or 2.9% in 2012, up from US$10.4 billion in 2009, or 2.7%, at the peak of the financial crisis, according to the World Travel & Tourism Council.

“Specifically hotel revenues in Saudi Arabia are growing steadily despite the looming recession in Europe. There is ample liquidity and business in Saudi Arabia so we see Saudi Arabia as a key hotel investment destination,” commented Amro Nahas, Executive Director – Head of Real Estate, Shuaa Capital Saudi Arabia.

The Kingdom is focusing its efforts on providing the necessary travel infrastructure to boost religious, business and domestic tourism and is spending more than $500 million on expanding its existing airports and is planning a new US$7 billion airport in Jeddah.